Growth at ALL Costs

"Grow or Die"

Author

Dimitri Thomas
October 22, 2023

One of my goals is to become a venture investor. I spend all of my free time studying business models, entrepreneurs, and new startup ideas.

To others it looks like I am focused studying. To me I am getting lost in the possibilities and having a blast learning. Time flies by.

Do the thing you enjoy. Spend your time becoming an expert. Then profit.

More on this later.

Grow At All Costs

An observation I have made is that startups and VC’s weigh heavily on growth. You will commonly hear terms like:

  • Network Effects: the more users the more powerful

  • Mass Adoption: self-perpetuating growth

  • Economies of Scale: as production increases, cost decreases

Grow At All Costs.

Get as many people on your platform as possible. Grow until you reach mass adoption. Once growth is stable and consistent economies of scale should kick in and your business will start to make money.

Go Fast & Break Things. High Risk, High Reward.

Venture investing has slowed. Is this still the best method?

Profitability At All Costs

Big valuations and large exits are easy to chase - shiny object syndrome - but is that an ideal outcome for all companies?

Many investors who are sitting on dry powder (cash) are hesitant to deploy capital due to the uncertainty that lies ahead. Investing in startups is typically 7-10 year deal where macro economics have less of an impact. Still, VCs are looking for business that can become profitable in the near future because in order for investors to get a return on their money the company must exit. Market conditions can determine the success of a startups exit price.

Tools

New businesses can build out their infrastructure using AI and other tools from the start, where established businesses may find it harder to migrate their existing systems. Starting the business lean and with a focus on automation can help businesses reach profitability much sooner.

Creators

Creators and 5-to-9ers who have a decent size following can leverage their audience and community to sell products. These wont be the next hot tech startup but they usually require small amounts of capital and can bring in $1-10 million profit per year.